Once a client has decided on the property they are buying in Malta, and price and conditions have been agreed, a preliminary agreement (convenium) is signed between the vendor and purchaser. This agreement binds both parties to sell/purchase the immovable property under the terms and conditions agreed upon. The signing of the final deed is, however, always subject to good title being proved and the issue of any relative permits to purchase. The agreements when buying property in Malta are generally always written in English.
On signing the preliminary agreement tied in with buying property in Malta, a sum equivalent to 10% of the price is lodged with the agent or notary public as stake-holder. This deposit will be forfeited in favour of the vendor should the purchaser fail to complete the final deed of transfer for no valid reason at law.
The agreement is usually valid for three months (term prescribed by law) or as mutually agreed by the parties. During the period between the signing of the preliminary agreement and the signing of the final deed of sale, Notary Public engaged by the purchaser will carry out the necessary researches into the property to confirm good title, as well as submit the application to purchase to the Ministry of Finance if necessary.
Once the relative permit has been issued and researches have proved clear title to the property being bought, the final contact of sale may be entered into, the deed of sale being drawn by purchaser’s Notary. The balances of the purchase price and stamp duty plus legal expenses are paid on the signing of the contract when vacant possession to the property is handed to the purchaser. (1% of the stamp duty due is payable on the signing of the preliminary agreement.)
Expenses connected with the acquisition of property are as follows. One needs to pay 5% stamp duty and another 1% goes for notarial fees. Both Search and registry fees and Ministry of Finance fees are approximately €233 respectively. The above expenses are borne by the purchaser, while brokerage fees due to the estate agency are borne by the vendor.
Individuals who are NOT citizens of a European Member State may acquire immovable property in Malta after they obtain the relative permit in terms of Chapter 246 of the Laws of Malta from the Ministry of Finance.
